Kenneth Chau & Co.

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Hong Kong Budget 2017-18

Kenneth Chau & Co. welcomes the recent budget speech of The Hong Kong Financial Secretary (“FS”) on February 22, 2017. The FS has announced the 2017/18 Budget, outlining the government’s plans for the economy and public finance.

 

A brief summary of the Hong Kong Budget 2017-18:

Economic Outlook for 2017

·       Forecast GDP growth of 2% to 3%

·       Forecast headline inflation of 1.8% and underlying inflation of 2%

Major Tax and Relief Measures highlights

·       Profits tax rate for incorporated companies remain unchanged at 16.5%

·       Introduce profits tax concession to promote aircraft leasing and financing

·       No change in the standard tax rate and progressive tax rates of Salaries tax

·       Widen the marginal tax bands from HK$40,000 to HK$45,000

·       Waive 75% of profits tax for 2016/17 (subject to HK$20,000 ceiling)

·       Waive 75% of salaries tax and tax under personal assessment for 2016/17 (subject to HK$20,000 ceiling)

 

Fact sheet of Hong Kong Tax Rates 2017-18 and 2016-17:

  2017-2018 2016-2017
Salaries Tax rates    
First HK$45,000 (16/17:HK$40,000) 2% 2%
Next HK$45,000 (16/17:HK$40,000) 7% 7%
Next HK$45,000 (16/17:HK$40,000) 12% 12%
On the remainder 17% 17%
Standard rate 15% 15%
     
Property Tax rates    
Tax rate 15% 15%
     
Profits Tax rates    
Companies 16.5% 16.5%
Unincorporated businesses 15% 15%

*** The above measures will be effected upon passage of the legislation.
***(Source from: http://www.budget.gov.hk/2017 )